LIAT’s woes reflect business conflicts, limited vision, in intra-regional Caribbean aviation

For intra-Caribbean aviation the old adage “the more things change, the more things stay the same” rings true. Unfortunately, the regional airline LIAT is a perfect example of an airline whose financial and operational failures are the epitome of stagnation in a region where outdated government policies constantly squash innovation.

During the past year some of the shareholder governments of the perpetually troubled airline have attempted to initiate tough love for LIAT, including threatening to withhold funds until LIAT can improve its service and operations. In some ways those threats are a double-edged sword – given the challenges of doing business in the region, a business environment largely driven by years of governments propping up state-owned airlines instead of allowing free market forces to take effect.  

Although LIAT's shareholder governments would like to see more competition, the reality is that the aviation business in the Caribbean remains in a state of inertia, and all of LIAT's pledges for improvement will likely not materialise until a true mindset change sweeps over the region.

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